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Szelhamos Rules

Jon Corzine

Stunning Reversals


I've never made any secret of the fact that I don't read very much.

My daily ritual of reading DIlbert and The New York Times Obituaries was recently complemented with James Altucher's blog. I actually thought long and hard about whether to refer to it as being in "complement" to or in "supplement" of my daily activities and realized that there really wasn't a word to convey both impacts.

I've linked to it a couple of times and bored readers of this blog have clicked on that link, which has also activated a small hidden webcam near their laptops, in addition to any resident webcams you they already have.

I like my fuzzy clandestine streaming to be in 3-D.

For those who read this blog on a regular basis it doesn't come as a surprise that I don't read much. In fact, there's really not a strong body of evidence that I even read my own blog, much less proof-read it.

And forget about reading for the sake of getting my information right.

OxymoronsWhen I was younger, I was horrified to find some ham in our refrigerator since it's not Kosher, as you may be aware.

My mother, in response to my pointing this out to her, said "if it tastes good, it's Kosher."

What a great philosophy.

I use that philosophy with my supportive facts. If I believe them to be true and accurate, then they're true and accurate.

A "Kosher pig" is an example of an "oxymoron" until some moron ruined it about a decade ago with the discovery of a species of pig in some god-foresaken rainforest that might just satisfy all of the criteria necessary to be considered Kosher.

I wrote about Oxymorons a few months ago, but with an emphasis on the "moron." The thought was rekindled a few days ago reading one of Altucher's blog entries.

He was asking whether there could really be anything such as an amicable divorce.

In a world of delusion there probably exists such an entity, but then again delusion and the real world are themselves mutually exclusive.

In the real world you end up in "divorce court," which, wouldn't you know it, is itself an oxymoron. Just for fun, see if you can find all of the highlighted and hidden oxymorons in today's blog'

Today, I watched what was called by many a "stunning reversal" in the price of silver.

In fact, they were correct as silver one upped gold and not only cut its earlier steep losses, but ultimately had a nice gain at the end of the day.

One of the things that I've come to like are "tag clouds."

For someone who doesn't like to read, tag clouds are just great, unless you get bogged down by the concrete concept of tagging a cloud. Or having physical contact with an etheral concept.

Thinking too much isn't an oxymoron, it's just an impediment sometimes.

Through the tag cloud by simple virtue of font size, boldness or color, you can immediately know what's important to the author. You may not know whether it's love or hate, but at least you know about the intensity of the apathy.

In my case, the tag cloud lets you know that I have some recent passion about silver, more specifically in the prospects of silver prices doing poorly, as I own the leveraged silver ETF that appreciates in value as silver prices drop.

Before I owned the shares my interest in silver was neglible, other than as an historically important treatment for gonorrhea and vampires, as well as syphilitic vampires. You would have known that as the words silver, gonorrhea, syphilitic and vampires never appeared in the blog's tag cloud.

During the course of the day as the Dow closed up 135, at its high for the day, the ProShares UltraShort Silver ETF closed down $2 from its intra-day high. That drop represented about a 12% move, which was of course exaggerated compared to the actual movement of the underlying metal, due to the leverage.

Think of leverage as being a financial tag cloud, only in reverse. The less you put on the line, the bigger the potential risk or reward.

In that way, think of Jon Corzine as being about 13 times larger than the most leveraged ETF currently approved for trading. The difference being that the leveraged ETF is typically highly sector focused and doesn't require much in the way of thought process.

Math? Yes.

Thought?

Well as Dennis Gartman might say. Thought on and thought off.

Moron.

On the other hand, under Corzine the focus was placed on an aspect of finance for which resident expertise at MF Global Financial was missing. Yes, that's right. Your local MF Global Financial knew nothing of international currencies and swaps.

Moron.

Actually, to be totally fair, both are exceptionally intelligent morons, based on my archival research.

"Stunning reversal" doesn't really qualify as an oxymoron in the classic sense, although there are many variety of "Oxymora," but just like doing a treatise on what makes something funny is immediately not funny, so too is an encyclopedic look at Oxymora less than intellectually amusing.

No one should ever be surprised by "stunning reversals."

Have you ever been to a 25 year high school reunion? Just look at the gut of the guy that was on an athletic scholarship.

Have you ever looked at every stock chart ever?

Unlike last month and the one before that, so far during this entirely unsatisfying January options cycle, I haven't had the opportunity to benefit from the recurrent big spikes in silver prices.

In those months, just as today, the stunning reversals were predictable. What was certainly unpredictable was the inability of thr talking heads to portend the past.

And so here we are, about to enter the last trading day of 2011 and very possibly having survived the single most roller coaster year ever in trading.

True, we didn't have a "flash crash" nor did we have any memorable declines or rises, but that's only because there were so many.

And just like a roller coaster you end up exactly where you started, just feeling a bit more queasy for having been intimately involved in the sausage making process.

But man, is that sausage "damned good" or what?

 

 

 

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Read me a Story

Moo Baa La la laI can still think back to those days when my kids would be put to bed each night with a story.

"Moo. Baa. La La La."

That phrase will be stuck in my mind until the day I die, as like most parents, I found myself reading the same story over and over, night after night, because that was the story that wanted to be heard.

Whatever it took to get the little darlings to sleep. Whatever it took. Even Moo. Baa. La La La.

I was only talked off the ledge because the nice policeman promised me I'd never have to hear those sounds again.

Instead, it was a book devoid of silly sounds, but sadly chronicling the deaths of brave, hungry, thirsty, polite, sleepy and explorers, leaving only a single smart explorer to survive.

"Six brave explorers came to Egypt alive, one discovered a rare bird and then there were five."

Different kids, different tastes. Different stories, but with the same need for the comfort that comes with repetition.

It was always so nice when one was ready to move onto a new book. I don't really recall, but I may have occasionally hastened that process by telling the kids that their mother threw out their favorite book in a moment of unrestrained rage.

Not trusting a parent is part of healthy childhood development. You can look it up.

Even "Atlas Shrugged" would have been a welcome change from some of the Berenstain Bears adventures, especially the dentist one. The Berenstain Bear loving kid of mine didn't have the same love for my attempts to read to him from more legitimate dentistry textbooks to try and offset the inaccuracies of the Berenstain version of teeth.

Fast forward some 15+ years and that brings us to today.

And here it is. The same old story. Instead of reading the book, all I hear is the constant repeat of the musical refrain, "Greece is the word, Greece is the word, is the word that you heard..."

Greece, the nation that gave the gift of democracy to the world also showed that it could lead the way in abandoning electoral responsibility, as Prime Minister Papandreou called for a national referendum to get approval for the austerity measures necessary to prevent a "hard default."

I've already forgotten what the root cause of the market's Monday downturn was ascribed to, but today everyone was on the same page.

"Greece is the word, Greece is the word, is the word that you heard...."

I've never really gotten to the point of being apoplectic, but I can imagine that Angela Merkel is at that stage.

Have you ever seen what happens when a German head of state gets upset?

What was really a sight was watching the former Greek deputy Prime Minister of Finance, who by the way was part of the more conservative opposition party, refer to the current Prime Minister as being emotionally and psychologically a basket case.

My words, not his, only because he didn't have the same fluency with American idiomatic expressions as I have.

So today's market was a reflection of all of the pent up anxieties of the past few weeks that were falsely put to rest late last week.

I'm not certain that InTrade is making book on the likelihood of the Greek populace voting to take the austerity measures that are part of the now infamous "Greek Haircut", that apparently requires shaving 50% of the head.

I'm guessing that if the vote can ever get pulled off before the Greek government falls, there not much of a chance that people are going to vote themselves into a life that they'd rather not live.

The good news is that each person can decide for themselves whether they want heads shaved in sagittal or transverse planes. If they play their cards right and perhaps use some entrepreneurial spirit, the "Grecian" may yet come to replace the "Brazilian."

See, you never got that kind of detail out of those stupid Berenstain Bears stories.

The Greek story was so dominant that even Jon Corzine was moved to the back burner. Any other day and news that MF Global may have violated some very basic elements of trust by using some $700 million of their client's funds for their own in-house and ill fated pursuits.

Sometimes it's a good thing when some other story pops up.

To this day, ex-Congressman Gary Condit is no doubt grateful for the timing of 9/11. His role in the disappearance of young intern and romantic liaison was all but forgotten as he quietly stepped away from the spotlight.

Of course, the opposite can just as easily occur. Just ask Farrah Fawcett.

Figuratively, of course.

He fame long ago faded was rekindled with the effort to document the ravages of her anal cancer and subsequent death.

Unfortunately for her, her producer didn't clear her passing with Michael Jackson's itinerary for that day.

So Corzine got a pass and may still be on the short list to replace Timothy Geithner as our next Treasury Secretary, unless of course someone on the search committee has an "aha moment" and remembers that Corzine was the guy in charge when MF Global went bankrupt and stole their clients' money.

That may be a bit harsh and things still remain to be sorted out.

What is clear is that Corzine bet and he bet big and he bet wrong.

Corzine used to be one of the big boys at Goldman Sachs, co-CEO with Hanry Paulson. There's a reason that the Goldman people are called "the smartest guys in the room."

What Corzine failed to take into consideration was that he had left the room and apparently the other kids took all the smarts with them. People marching up and down Wall Street may disparage Goldman Scahs and may blame them for the financial meltdown, but last I looked, no one was accusing them of stealing money or dipping inappropriately into anyone else's pockets, as your old weird uncle used to urge you to do with him.

While Corzine was being trivialized, news from Greece threw the market into spasms of optimism interrupted by spasms of pessimism.

Word that the idea of a referendum would never occur helped the market recoup about 100 points from its low.

Further word that Papandreou might be psychotic or having some kind of a breakdown was comforting to the markets.

When it was all said and done it looked as if only some form of chaos was in the near term crystal ball, so the market just gave up.

Not capitulated, just gave up and called it a day. A bad day.

I picked up some more shares of Riverbed Technology and marveled at how the ProShares UltraShort Silver ETF that I owned, some of which is hedged, has been serving as the perfect antidote to both the fleeting feelings of elation and depression.

Those feelings come and go because it's just a reflection of the same old story that is the big picture. The book, as it were. The book that encompasses Greece, Corzine, the Yen Carry Trade, High Frequency Trading and so much more.

That story of that book is that what goes up must come down and must then go up again, only to come down in time to do it all over again.

Strangely, I never tire of that book, only the stories in it.

To me, the details of each breaking business or economic story now all sound the same.

Moo. Bah La La La.

All I care about is that at the end of each day I'm not one of those investor explorers who doesn't live to see another day.

I'll do like that smart explorer who just stayed in bed and avoided the predictable traps. Who needs excitement?

Just make mine a La-Z-Boy and make certain the Moo Lah, Moo La La stays safe with me.

 

 

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I Hate Haircuts

There's been so much talk about "haircuts" lately.

Wall Street is good when it comes to descriptive terms that may or may not describe anything. We've had quantitative easing (1 and 2), risk on/risk off, kicking the can down the road, dead cat bounce, rip your face off rally and now haircuts.

As best as I can figure, in financial terms, the extent of a "haircut" refers to how much give back is necessary to achieve something resembling financial solvency.

As opposed to the real world of hair cutting where there is no cost differential based on the amount of hair shorn, it appears that the extent of the haircut elicits fevered opinions as the perceived costs are culturally unsettling.

Greeks, apparently are a hairy bunch. Thank goodness Armenia isn't a member of the EU.

As soon as talk centers on the possibility of Greece perhaps needing to take a bigger haircut than initially thought, there's more rioting on the streets of Athens.

Retiring at age 27 instead of 25 makes some people very angry. Angry enough to toss Molotov cocktails made from the strange green antiseptic liquid that cleans the instruments of haircutting.

Jennifer Aniston - The antithesis of a JewFoHaircuts do that sort of thing to people.You know how irrational people can be when they get a haircut that doesn't suit them or that doesn't satisfy their preconceived notions.

With the remnants of my Jew-Fro, I still aspire to look like Jennifer Ansiton after each haircut, but am serially disappointed.

Speaking of haircuts and serial disappointments, look at poor Jon Corzine, CEO of MF Global.

On Tuesday, MF Global had the fine distinction of losing even more, on a percentage basis, than even Netflix.

Did I mention that Jon Corzine was follicularly challenged?

First he was forced out as CEO of Goldman Sachs, then he leaves after a single term as New Jersey Senator, to use his hands on organizational skills to lead New Jersey during the beginning of the area's financial meltdown.

Depending on your perspective, Corzine either gets a demerit for bad timing or a slap on the back of the head.

For bad timing.

Did I so neglect to mention that New Jersey was perhaps every bit as much dependent on the health of Wall Street as is Wall Street? The state didn't fare terribly well during the Corzine administration as Wall Street melted down.

If you want to talk about where Main Street meets Wall Street, look no further than the newly rehabilitated cities of New Jersey.

Of course, there's always the embarrassing evening when Corzine was at the Islamic Society of Central Jersey and was mistakenly characterized as being Jewish.

That's not going to help your election chances, at least not among the Central Jersey electorate. It doesn't matter how often you deny it. His problem was that he didn't vehemently deny it. He should have had his publicist add an "h" to "Jon".

That he was voted out in favor of Chris Christie, who is fully maned and obviously not Jewish, is just coincidental. But you don't find very many Jews that use the name of the Savior as both their first and last names

After trying his hand at politics, it was back to Wall Street for Jon Corzine.

For a guy that doesn't have much on top, he took another huge haircut on Wednesday, as shares of MF Global, with many financial interests in Europe just got hammered again.

I feel badly for Jon Corzine, although the worst may be yet to come.

That is, if Dick Bove, who is not one of my favorites, is correct in the suggestion that Goldman Sachs is a possible buyer of MF Global.(See: I Never Liked Dick Bove)

In that case, Corzine may request a cut starting at the neck.

In the wake of Netflix and now Amazon, I've gotten a haircut well beyond what I had asked for.

You can't even begin to tell that there's a Jew Fro in there somewhere.

I hate haircuts of all kinds.

When I first moved to the Maryland area, I had to find a replacement for the Faleri Brothers, the two raging anti-semitic haircutter brothers, with horrid gingivitis and a penchant for overly small Qiana shirts. To their credit, they did an admirable job with my difficult to maintain mane.

One thing that I learned during that period was that when one makes distasteful comments and has a sharp instrument in their hands, disagreeing is really a question of proper timing.

It had taken me years to get used to them, although I'm not certain why that was the case.

After my first haircut in my new home at one of those mall franchise places, I was asked by the "stylist" how I liked the haircut.

I always say that I liked it, despite the fact that I could never see what  was looking at without my glasses being placed back on.

Upon telling her that it did, in fact, like the haircut, she then proceeded to ask me if I would be willing to sponsor her brother so that he might emigrate from Hait to the United States.

That seemed like a reasonable reuest, so upon thinking about it for a brief nano-second, instead, I gave her an extra 5% in the tip and never returned.

For the next 15 years I just continued being ill at ease having my hair cut and being handled by people with very sharp instruments near the organ  of mine that I treasured the most.

No. I don't get Brazilians.

I rarely would go, only doing so when Sugar Momma would threaten not to go out with me in public until I made myself presentable.

About 6 months ago, by special request, Sugar Momma gave me a haircut. She had never done so before, but I had it with trying to make small talk, reading totally uninteresting magazines and constantly being peddled all kinds of hair products.

Long story short? Best decision of my life. In return, I vowed to trim my beard on a regular basis.

No conversation. No tipping. All I need to do is sweep up the curls and sleep with the girls.

Now, Sugar Momma refuses to be seen in public with me because of the tee shirts I choose to wear. They're not even made of Qiana, but they tend to be Malt liquor centric, as hand me downs from my son, whose friend's father owned a liquor store.She doesn't think it appropriate that I be seen in public with such attire.

What can I say? It's all a work in progress.

As the trading week itself was progressing to the mid-point, Iwas adjusting my selt belt for Green Mountain Coffee Roaster's earnings announcement in anticipation of yet another haircut. Instead, word came that the announcement wouldn't come today, as planned.

Given the warnings this week from David Einhorn and others, that can't be good news.

At the very least Netflix showed a bit of a bounce after Whitney Tilson, the oft wrong Netflix short of past, announced that he was now buying Netflix shares. That sent shares up by about 4%.

4 down and 30 to go, but you still can't even see a 5 o'clock shadow on my skull.

The one thing that was really reinforced for me after these few days of overly speculative play is that I really don't like getting my hair cut.

I don't mind a little trim, as long as my new growth exceeds the removal.

Someday, and that day will come, maybe for Jon Corzine, as well, that I'll be able to look into the mirror and see the perfectly layered shag so wonderfully worn by Jennifer.

But until then, despite Sugar Momma making the whole process a little more tolerable, haircuts will remain well down my list of favorite things, along with Netflix, Amazon, Green Mountain and any Wall Street words du jour.

But unlike Jon Corzine, I know that when I get clipped, literally or figuratively, it's coming back.

So no matter how bad the cut, I just take the glasses off and it looks great.

Netflix will be just fine and so will Amazon. Once they come back, or I make up the difference between buy and sell price with options premiums, they'll be gone.

If it doesn't work out that way for Jon Corzine, I'd like to be among the first to invite him to me in my personal Hair Club for Men, where no one cares what length of hair you have, the length of your beard or what tee shirts you sport.

Things can only get better.

 

 

Hop SIng and Paw Blaze a New PathAmerican Tower ChartMake you Portfolio Work for You!

Invest like TheAcsMan

Option to Profit is available as either an eBook or 300+ paperback. Take a humorous look at a serious topic and learn how to make your portfolio finally go to work for you in bull and bear market environments.

See a sneak preview of Chapter 1.  hoco blogs

More about the book and purchase options. Scroll down and read the Szelhamos Rules blog, updated every weekday.

Find  OTP Book at Amazon, B&N or now you can also Order direct  from publisher. Use 10% Discount Code P4S2ZD8H

 

  




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